The leveraged asset purchases of Dubai-based wealthy non-resident Indians in the past few years may begin to haunt them, as the collapse of real estate prices in the emirate prompts calls for additional funds as margins which may force them to sell some Indian assets, experts say.

Indian HNIs high net worth individuals made good use of easy credit lines in the past two years, says Dubai-based JRG International Brokerage CEO PK Sajitkumar.

They even made investments using leveraged money, investing into India-focussed funds, buying freehold property and buying into Indian shares through participatory notes,” he said....

Home loan interest rates have come down quite significantly over the last one year as the Reserve Bank of India RBI cut the key policy rates repo and reverse repo rates and the cash reserve ratio CRR. The RBI adopted a soft monetary policy by reducing its policy interest rates.

The RBI adopted the soft interest rate regime to promote spending and stimulate economic activities, and prevent the economy from getting into a recession in line with the global economic conditions.

In general, the economic conditions have improved significantly over the last few quarters and the liquidity situation is good in the system....

It was touted as a realization of the ultimate middle class dream houses that fit the pocket. Just that it went bust. Months after developes flooded the market with housing projects tagged as affordable there seem to be very few takers. The reason the actual area of many of these flats is far less than usual. Others are being rejected because of poor location.

Said Renu Chaddha name changed,who had bought a flat in an affordable housing project that was launched in Faridabad earlier this year, and is looking for another property to invest in. At that time, only a few developers had launched their projects. All of them had good locations, so my husband and I decided to invest. It was only around Rs 20 lakh. Six months down the line, Chaddha says that the newly launched housing projects have left her without any inclination to buy.

The usual room specifications are 1200-1400 sq.ft. For a two bedroom flat. But most of the projects coming out now and being marketed as affordable housing measure between 800-1,000 sq.ft, admitted Pradeep Mishra of Sainik Estates, a local broking firm....

Shriram Properties launched a national-level mid-income housing project here on Wednesday. Shriram Homes would see development of over 7,000 housing units in four cities Bangalore, Chennai, Visakhapatnam and Kolkata in the first phase.

All approvals are in place and construction should start immediately, said Murali, Managing Director, and Shriram Properties.

The projects would see a total investment of about Rs 1,500 crore, of which about Rs 850 crore has already been invested. The overall sales value has been estimated at Rs 2,300 crore, said Murali....

Indian real estate companies put up a brave front on Friday, claiming that they will remain unaffected by the Dubai crisis due to their limited exposure to that market.

The market seemed to have bought their story at least to some extent. Real estate stocks crashed on Friday before recovering along with the rest of the market, ending the day down 0.55%, less than the 1.38% decline in the Sensex.

Industry officials point out that the impact on India real estate industry is unlikely to be significant. They say the linkages with Dubai were two-fold. One was that some Indian real estate companies had plans to invest in Dubai. Also, Dubai-based developers, largely owned by the government of that country, were keen investors in the Indian real estate market....